The Central Bureau of Investigation (CBI) has identified both IAS officers as accused in the case against the alleged scam. The state had suspended the duo on March 22, 2012, after the CBI named them as an accused.

Phatak, a former Mumbai municipal commissioner, confirmed to have received an official intimation regarding his reinstatement. State officials said Vyas, a former finance secretary, too had been intimated.

Justifying the reinstatement, the government has cited an October 14,2011 government resolution, which states that a review committee headed by the Chief Secretary can recommend reinstating suspended senior officials (class I and class II), who were named in criminal offences, if criminal proceedings and departmental probe against them had not been completed within two years of suspension.

While the court is still hearing CBI’s criminal case, officials said that the departmental probe against the duo is yet to be initiated, with preliminary notices on why such a probe must not be launched being served on the duo only a few days ago.

The 2011 resolution states that the review committee has to keep the officer’s past record and status of the case among other things in mind, while recommending reinstatement.

Phatak and Vyas also met Additional Chief Secretary (General Administration Department) Bhagwan Sahai after their reinstatement orders. “We were told we would soon be granted a posting,” Phatak said. Both the officers are however unlikely to be granted plum postings, since the GR itself advocates “non-executive assignments” for such cases till the inquiry is pending. Phatak said, “I am willing to accept whatever post offered to me.”

While the state has reinstated the duo, sources said that there have been cases in the past, including one involving a former senior cop from the state, where the suspension had not been revoked even after two years. “The government has to seek the Centre’s permission for extension of suspension in such cases, which was not done in this case,” a senior official said.

During the period of suspension, both officers were eligible to 75 per cent of their salary as per government norms.